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60 Minutes piece on fraud in the medical industry

I don't know if anybody else seen the piece they done tonight about hospitals and just fraud in the medical industry in general. It was pretty eye opening to something that many of us already knew about in the first place.

The article focused on a company HMA (Health Medical Associates) and how they required doctors to insist on unnecessary testing and prolonged hospital stays to increase revenue.

They had over 100 former employees on the record talking about how the system was set up so that people with certain insurance, conditions and of age groups automatically were sent for countless tests. They showed performance review documents that stated that doctors had to meet inpatient and test levels nearly double that of the national average to keep their job.

I have mentioned on here numerous times that the law of supply and demand does not work the same way with medical services. What happens is as the # of docs increases in an area the threshold for which a service is requested is lowered, so that the amount of money stays the same for each doctor.

Originally Posted by MrPoon

man with hair like fire can destroy souls with a twitch of his thighs.

"i don't believe in mysteries but still i pray for my sister, when speaking to the higher power that listens, to the lifeless vision of freedom everytime we're imprisoned, to the righteous victims of people of a higher position" - planet asia, old timer thoughts

I have mentioned on here numerous times that the law of supply and demand does not work the same way with medical services. What happens is as the # of docs increases in an area the threshold for which a service is requested is lowered, so that the amount of money stays the same for each doctor.

How/why is that?

RAIDERS, SHARKS, WARRIORS

"i don't believe in mysteries but still i pray for my sister, when speaking to the higher power that listens, to the lifeless vision of freedom everytime we're imprisoned, to the righteous victims of people of a higher position" - planet asia, old timer thoughts

It is because we have a medical non system. Think of it this way. Imagine you were building a computer. The people making the case, are working from one set of plans. The people making the screen were working from another set of plans. The people making the electronics were working from another set of plans. The people making the hard drive was working from another set of plans. None of them are communicating very well.

They send you a case, a screen, electronics, etc, and are you really surprised they did not fit.

In the area of health care, because we are incapable of knowing when things are unnecessary, because it requires expertise that most of us do not have, the greed factor has no check to balance it.

Here is the question of the day, does anyone think that wealthy people should pay a lower percentage of their income to taxes than middle class people? Don't argue tax brackets, just a simple question. Do you think someone earning 46 million dollars should pay a lower percentage of their income than say someone earning sixty thousand?

Lets say that one eye doctor in town needs 10 cataract procedures to maintain his practice and income.

Another eye doctor moves in. Now to maintain the practices we need 20 cataract procedures.

There are two ways to do this.
1. make people sick. Not feasible.
2. Lower the threshold at which the doctor orders/suggests/advises for the procedure. Thus to people who before the doctor would have said "don't get it, your cataracts aren't bad enough" the doctor now says "get it., it will really help".

Originally Posted by MrPoon

man with hair like fire can destroy souls with a twitch of his thighs.

even worse is the fact that after costs analysis, it is STILL more profitable to behave immorally and illegally becasue the "fine' doesnt offset the consequences of getting caught.

For profit healthcare is a conflict of interest from Jump.
Add in a delivery system that exisits only like a middle man in a drug deal, and now you have the American healthcare system brought to you by the capitalist ideology.

Some colleagues of mine brought this scary phenomenon to my attention last evening.

As insurance and Medicare reimbursement to doctors and hospitals fall (Medicare is enacting a series of substantial cuts, which will be followed by the private health insurers), you would expect the use of hospital procedures to drop. Makes sense, right? Less money paid per procedure, less incentive to do them.

Unfortunately, that’s not how it’s playing out in the real world. Your neighborhood interventional cardiologist or cardiothoracic surgeon is accustomed to a level of income and lifestyle. That lifestyle is now threatened by shrinking reimbursement. True to the Law of Unintended Consequences, rather than reducing use of procedures, diminishing procedural fees are prompting a good number of practitioners to do more.

In other words, if each heart catheterization pays less, why not do more of them, along with more stents, pacemakers, defibrillators, and the like? If four heart catheterizations per day pays less, why not do five to make up the difference?

Voila! Income protected. Of course, it comes at the cost of more work. But I will give one thing to my colleageus: They are a generally hard-working bunch who rarely balk at 12-16 hours days in the hospital.

How do you do more procedures? Easy. Just lower the bar on who to do a procedure on. Use more aggressive criteria for pacemaker implantation. Interpret the always-fuzzy nuclear stress tests weighed more towards abnormal. Use scare tactics: “You never know–that chest pain could be the last warning you’re going to have!” Because the criteria for performing procedures is “soft” in the real world, it is easy to bend the criteria any way you want....

Also on the problem seen with Medicaid fraud. Since payouts are low, as one Medicaid recipient found out more procedures where mentioned as being done.

even worse is the fact that after costs analysis, it is STILL more profitable to behave immorally and illegally becasue the "fine' doesnt offset the consequences of getting caught.

Yup, also I've HEARD (no written proof) from various people in the health care industry of a certain manner in which pharmaceutical companies operate. So basically when a drug is made it goes through particular phases of clinical drug trial, and phase 4 is post marketing drug trial, meaning its available to and used by the public by this point. If a company realizes their product can cause fatalities, they WILL NOT immediately pull it. What they do is squeeze out extra time (for sales) and wait for the process to run its course, through the FDA or whatever, because they figure at that point the amount of profit they'll make will outweigh the amount of damages they'll have to pay off to the victims. Absolutely disgusting.

Originally Posted by stephkyle7

For profit healthcare is a conflict of interest from Jump.
Add in a delivery system that exisits only like a middle man in a drug deal, and now you have the American healthcare system brought to you by the capitalist ideology.

Very true. And since this IS how the healthcare system is set up, then what I wrote in my first paragraph is what is to be expected.

RAIDERS, SHARKS, WARRIORS

"i don't believe in mysteries but still i pray for my sister, when speaking to the higher power that listens, to the lifeless vision of freedom everytime we're imprisoned, to the righteous victims of people of a higher position" - planet asia, old timer thoughts

even worse is the fact that after costs analysis, it is STILL more profitable to behave immorally and illegally becasue the "fine' doesnt offset the consequences of getting caught.
For profit healthcare is a conflict of interest from Jump.
Add in a delivery system that exisits only like a middle man in a drug deal, and now you have the American healthcare system brought to you by the capitalist ideology.

That's the big factor. Corporations will not change their practices otherwise.

One famous(and somewhat off-topic) case is from the 70s, where GM kept having their fuel tank explode from rear-end collisions, b/c the tank was placed at the back of the car.

After doing a cost-benefit analysis, they determined that the $2 extra per car from lawsuits by people who were badly burned or killed by these explosions was worth paying over the $8.59 per car cost of moving the tank.
An extreme example, but it paints a good picture of how far the profit motive can go for these companies.